Any big change means uncertainty and uncertainty means markets will go down. That is exactly what the market is doing – pricing uncertainty. Very few of us know how the world will be in Jan 2017 or rather April 2017 once all this note exchange is over.

In the immediate short term there is bound to be confusion. So somebody will tell you that ‘cash consumption items will fall’. True. Absolutely true, and people will preserve cash – so nobody who was spending Rs. 4000 on an eating out bill is going to eat out for a long time. Similarly people painting their house will no longer be able to buy Asian Paints by paying cash. So obviously Asian Paints should fall. However, remember for the smart, intelligent, brilliant guy sitting in a fund house – in the same category are Dabur, Britannia, Hul, Colgate – so all these shares will fall.

What about Apollo hospitals? Of course it has to take a hit – many surgeries were paid for in cash. So there goes another area where cash was used extensively. Then the wedding planners – will it make our weddings less noisy and glamorous? Not sure, but the pathway has been laid.

The high end gyms, luxury products, etc. which were a lot of cash based expenses, will all take a hit, at least in the short term.

Namo has hit SP, Bsp, Mamta, – real hard. How will all this pan out? God alone knows. I can believe that even Jet Lee was not given enough time to react. Was his proximity to PC a worry?

Will Amma strike a deal with the temples (remember all temples in TN are controlled by the Government – hence all the money confiscated and temples not maintained at all) – will she convert all her higher denomination notes to smaller notes? God knows.

Will the sales of Indian Hotels, Trident, Mahindra Holiday resorts go down? after all people were paying the basic bill by cheque but the booze and other bills were being settled in cash, right? No idea

Will the collection of Equitas, Cholamandalam, and Ujjivan be impacted due to the non availability of cash? In the short run SURELY yes. So for the quarter ended December and March 2017 these companies are going to post very poor numbers. Does this mean a Chola which was selling at 1235 now sell at 600? or will it become a good buy at 850? That is your call. Should you wait for the next quarter’s results?

The booze bills used to be settled in cash – so in a cash preservation mode, these bills might be scaled down.

As of now in most cities it is possible for you to buy clothes, other items of consumption …for cash.

What happens if you are a big bank like SBI – you get tons of money. It helps your CASA in the short run. Ditto even for Hdfc bank and Icici bank – but clearly the PSU banks get an amazing amount of cash. Banks which have a huge home loan book and auto loan book may have 2 immediate problems – the sale of Real estate may be down for a while, and the ‘home improvement’ loans may not take off for a while. Or will it? WE do not know is the only truth.

What about fertilizer companies? Like say Coromandel International? Is there a ‘black’ and ‘white’ problem? hell no, but there will be a lot of inconvenience. Namo has not perhaps appreciated the distance between bank branches. I know in villages people telling me that they lose a days wages if they go to the bank. Do all farmers deal with Rs. 500 notes? yes those who buy fertilizers and pesticides do. And  anyway everything is tax free – but the inconvenience of small notes is likely to hit the quarterly results…

NaMo has started a chemcial warfare aimed at the terrorist, the drug dealer, at the political parties and of course at the black marketeers. His own party must be screaming – and he was anyway not the most popular guy around.

What happens in Jan 2017? Will he make some concessions?

what am I doing? yes i got rid of a few shares and bought some shares which have nothing to do with India like IT. With a strong dollar, I am bullish …what should you do? it you trust your fund manager, just continue like nothing happened.

In 2022 when you are watching the graphs, 8th of Nov will be just a blip.

wait and watch….